The AMEX composite index is a capitalization weighted index that maps all the stocks, ADRs, Closed End investment vehicles. REITs and limited partnerships listed on the American Stock Exchange. AMEX Composite was started by the exchange on December 29th 1995 with a base value of 550, the value, to which all subsequent index values are based on.
The AMEX Composite is a market value weighted index, that means the day-to-day price change in each issue is weighted by its market value (as of the start of the day) as a percent of the total market value for all components. Thus, the price change for each constituent stock affects the day's change in the index in proportion to the company's market value. The basic formula for any index is (be it capitalization weighted or any other stock index):
The Portfolio is divided by the Index divisor, in order to scale the value of the index to a more manageable number. Moreover, the level of the AMEX Composite is not altered by stock splits, stock dividends or trading halts, nor is it affected by new listings, additional issuances, delistings, or suspensions.